Can Construction Equipment Telematics Improve Customer Loyalty?

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By Mike Schmidt, AEM Industry Advisor Editor

An often overlooked byproduct of the rise of telematics in the construction industry is the opportunity it provides equipment manufacturers and dealers to work together in an effort to improve their relationships with customers.

Telematics has been around for decades, and the popularity of the technology has grown substantially since the mid-2000s. Until very recently, though, little had changed in how telematics was serviced and supported. But as the equipment manufacturers and dealers in attendance at last month's AEM-AED Economic Forum: Drivers of the Industry event learned, a new approach toward servicing the technology is becoming increasingly popular nowadays.

“If you think about the customer, they have one goal in mind: move the dirt,” said Ryan White, product manager, connected services at Volvo Construction Equipment, a leading manufacturer of construction equipment. “The OEM needs to be able to provide solutions to the dealer to aid them in that journey. We can’t just give them information and tell them to go find the value in it.”

Data Management As Customer Service

The world is becoming more and more connected by the day, and one of the consequences of this reality is the existence of an almost incomprehensible amount of data to be processed and managed. Many construction companies today lack the time and resources to harvest and interpret the information coming off of their machines, so they look to the manufacturers and dealers of the equipment for help.

Providers and distributors of construction equipment are not only recognizing the informational needs of their customers and responding accordingly, they are leveraging it to improve service. By collecting and processing machine data and providing their customers with relevant and useful operational information, they are better meeting the needs of those who use their equipment and positively impacting customer satisfaction and loyalty.

“Information is clearly power for manufacturers, dealers and customers alike,” said Dave Combs, executive vice president of Patten Cat, a dealer of Caterpillar equipment in Illinois and Indiana. “But it’s critical we make sure we are managing our equipment using this data for productivity, safety and sustainability. It allows us to now anticipate our customers’ needs to  better serve them. It also helps us gain efficiencies in our work processes… to reach our customers more effectively.”

Telematics Improves Equipment Uptime

Volvo’s efforts to reimagine how telematics can be serviced led the company to open an uptime center, where the company monitors its customers’ equipment and sends out actionable insights to based information being gathered. Volvo also launched web portals containing relevant telematics data and provided their customers with free access to them for a limited time period, in the hope they would eventually see the value in paying for a subscription.

“What we’ve seen is customers are really starting to adopt this new program,” said White. “They’re not the ones who need to go in and find value in the data. We’re providing the value to them. We’re showing them what they need to do in their business, as opposed to just giving them the data.”

Once Volvo began monitoring customers’ machines, company officials noticed their clients no longer felt the need to access the web portals themselves. After a number of discussions with customers, it was discovered that they don’t possess the necessary time or resources to maximize their investment in telematics on their own.

According to White, Volvo realized the onus was on OEMs like themselves to show their customers the value of diagnostics by sharing important operational data with them in an effort to help them achieve value in the form of lower total cost of ownership and longer machine lifespan.

At the OEM level, we can analyze all the data we want, we can improve machine quality, and we can drive that down to our dealer network,” said White. “But if we’re not getting this information and value all the way down to the customer, we’re losing the real value in the service.”

For example, he explained, Volvo representatives at the company’s uptime center not only have the ability to monitor conditions on a machine, they can send all of the diagnostic information and customer contact information for any specific equipment incident they noticed directly to the dealer. As a result, the dealer then knows who the customer needs to contact, every part necessary to make the repair, and the relevant details of the issue with the machine – all before an appointment with the customer is made.

Monitoring Machine Data

According to Combs, there is tremendous value for dealers in being able to use machine information provided by telematics to gain a better understanding of their customers’ operational needs and wants, as well as to answer any questions or concerns end users may have about the equipment they employ.

And while monitoring machines and analyzing the information coming off of them is not a new concept to equipment manufacturers and dealers, the ways in which the data is collected, interpreted and leveraged has changed significantly in recent years.

“We’ve always, in some way, monitored machines and critical assets,” said Combs. “The way we used to do it is by walking around the machine, looking with our eyes and ears, and maybe we were sophisticated enough to do an oil sample and a root cause analysis to figure out what was going on inside the engine. But today, the information is available.”

There’s no denying machines will break and equipment operators will experience downtime on occasion. However, what manufacturers and dealers once a customer is forced to deal with a breakdown is up to them, because the rise of telematics in the construction industry is about more than just improving machine quality. The increased prevalence of the technology provides equipment manufacturers and dealers with valuable opportunities to engage their clients and offer them real, actionable data to help them get their equipment up, running and back on the job.

“The customer still relies on us to understand the equipment, and to interpret that data, ultimately eliminating the need for their own resources to pull all of this information together,” said Combs.

“If you don’t have a business model going forward that looks something like this, then I would say you’d better look at it, because this is the way of the future,” he added.

Volvo Construction Equipment's Ryan White and Patten Cat's Dave Combs were among the featured speakers at last month's AEM-AED Economic Forum: Drivers of the Industry event in Rosemont, Illinois.

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